Search smh:

Search in:

How to handle staff in a booming business

Q. I have been running my graphic design business for over six years now and my wife joined around a year-and-a-half ago. The business has really taken off and we use freelancers quite often. I really want to put someone on full-time to help with the growth of the business as I know it will enable us to take on more work and in turn push the business in the right direction, but as the graphic design industry can go quiet at times I also think sticking to freelancers is a great alternative. To sum it up I'm really in two minds.

A. This is always a difficult decision to make. Indeed in my experience gained over many years of mentoring, managing staff is the area most small business owners struggle with. And it is often the reason they are unable to grow their businesses and are forced to continue on with just themselves and close family members.Very often they have had a negative experience with staff that has been so traumatic that they have lost confidence in their ability to select suitable people.

Problems with staff are not unique to small business. All businesses need to deal effectively with their staff to maintain a harmonious work environment and to bolster productivity. Larger companies allocate many full-time resources to their personnel or human relations departments. These departments are not just involved in recruitment and retrenchment but their charter extends to staff training, running improvement programs and staff performance reviews.

In most cases staff problems are not simply one-sided. Business owners are quite naturally protective of their businesses and regard them as their children. They may not be receptive to a new staff member suggesting alternative ways to do things. Their management styles may be directive and authoritarian and this can quickly lead to conflicts, particularly if the new person has a strong personality.

Advertisement

To assist here, some management training can be beneficial in helping the business owner better understand the different personality types and how to manage them most effectively. Carefully selecting the type of person for the job is also very important and this includes thoroughly vetting their referees. There are many courses that can be taken to assist here and the Australian Institute of Management might be a good place to start.

In your case, you appear to be managing this task very well in your selection of freelancers. Obviously such staff will be mainly interested in performing the tasks they have been allocated and will not be inclined to be looking at other issues that might be relevant in advancing your business. A full-time staff member would be expected take a much deeper interest in your business and help you to expand it.

A full-time staff member also sends the message to your customers and potential customers that you are growing and are successful and may itself help to bring in new business.

Obviously you are also incurring a liability – a financial as well as a moral liability; a person that is dependent on you for their livelihood. As well as the additional productive entity you have taken on, another positive is that you will now be under some additional pressure to find new business.

If you think that you will be comfortable with this pressure and the responsibility and are confident that you will be able to grow your business then I would recommend that you proceed. However do this in a planned way ensuring that the role and expectations are clearly defined and agreed.

7 comments so far

".......... as the graphic design industry can go quiet at times ........"

None more than the freelancer knows this to be a fact.

For you it might represent unreliability when it's busy and perhaps lost opportunity for further business. You know, it would be nice to make hay whilst the sun shines, type of thing.

For the freelancer it can mean the difference between paying rent or having to go home to mum. No long term planning for the freelancer. Try borrowing for a car with haphazard work in your resume.

Employing someone permanently, full time or otherwise represents a risk for you, understandable. Casuals are unreliable. Understood.

How about something in between?

A six month contract with a six months option and a bonus to take up the option at the end of each six month period?

Plenty of freelancers would love the surety of six months’ pay Belive me.... I know

Commenter

Rubens Camejo

Location

Maroubra

Date and time

October 05, 2012, 2:37PM

Now, that's a good idea!!

Commenter

Lynne

Location

Melbourne

Date and time

October 07, 2012, 10:52AM

I had a very bad experience as an employee of a small business after initially being a contractor which supports this authors experience that very often small business owners are very poor people managers. My previous experience was in large businesses and after I joined them full time I found that this small business started to treat me like a child or at the very least a very junior employee and had no idea how to manage a professional highly experienced manager - totally autocratic, micro managing, issue avoiding, poor communication and emotional decision making.

I would advise anyone consider jumping ship from a large company into a small business as an employee to instead be a long term arms length contractor where you can maintain your own professional independence and income via a well structured commercial contract rather than an employment contract. You will also find that if anything goes wrong the commercial contract will be easier to enforce than the employment one despite all of the employer bleating about the fair work act.

Commenter

never again

Date and time

October 05, 2012, 7:28PM

I have owned a successful small business for 25 years. My advice is to be exceptionally careful when hiring anyone on a permanent basis in Australia. IR laws are very difficult to administer in the real world of small business and can take a lot of your energy and divert you from the main game. Some days I spend the majority of my day dealing with HR issues despite the fact I have a terrific group of staff. As well, it has been virtually impossible to shed a disruptive staff member even if they are the most junior. There are just so many regulations and laws you have to know about, and inevitably it costs a lot of money to deal with the problem - money which could have been spent growing your business. It also takes a big emotional toll which, drains energy and consequently innovation from your business.

As a result, I use a lot of regular freelancers - from Australia AND around the world. It is a fantastic means of skimming from a broad and rich source of talent - particularly in regard to 'creative'. I could not have been so successful without them. Many have worked for me on and off for years and both sides appreciate the working relationship and the unexpected commitments that emerge over time. Commitments that are built on mutual respect rather than regulated authority. The value to me is that my business can remain nimble and I get creative input from a large range of global sources.

Commenter

Granny-with-grunt

Location

Melbourne

Date and time

October 06, 2012, 4:48PM

Freelancers are your potential competitors and are always on the lookout for their next job.The right employee will want your business to succeed and have the loyalty you'd not get from most freelancers.

Commenter

JohnB

Location

Melbourne

Date and time

October 06, 2012, 6:48PM

Rubens is right. As an SME employer with an ad agency I find it difficult to recruit great staff. I start with a contract position to test the waters and see the fit of the new addition first. When it's right, I can go to a salaried position. If business turns slow, the obligation is limited and no need for redundancies. Freelancers are more difficult to manage but offer a wealth of skills you can never get in employees in a small business. I don't agree that full time employees necessarily bring in more work in the graphics field. Having a flexible access to a skills base required for the huge variety of jobs in the graphics sector does. It's easier to find freelancers who specialize and have critical up to date knowledge in particular areas than try to train a full timer across print and digital.

Commenter

Amf

Location

St kilda

Date and time

October 07, 2012, 6:39AM

Having run a design studio for the past 10yrs - stick with what you know. You'd be well aware the industry is spasmotic at best and a flexible workforce works in this industry. Pay the good designers what they are worth and most will remain faithful and flexible to your needs. I find during my busy periods when I contemplate staffing - I just work twice as hard reap the rewards. Only person in business you can trust is yourself. Or send the wife to work elsewhere and hire a full time staff member. Funny its Sunday and I am working on presentations. Go figure!

Subscribe to IT Pro

Editor's Choice

Prime Minister Tony Abbott has bolstered Malcolm Turnbull's ministerial duties, handing him greater responsibility for e-government in a push to expand the use of a single digital identity for Australians.

Data

The new roof that spans Margaret Court arena does more than keep out the weather. Built into the gantries that surround the sliding ceiling are Wi-Fi antennas that beam web access to every ticket holder.